UGC NET COMMERCE November 2017(Paper-II) Q15
0. Which one of the following is not the basic property of indifference curves?
- Option : B
- Explanation : Indifference curves for normal goods have not only a negative slope, but are also convex with reference to the origin. The convexity of the indifference curves implies that:
∎ The two goods are imperfect substitutes for one another.
∎ The MRS between the two goods decreases as a consumer moves along an indifference curve. Convexity in the indifference curve is caused by the diminishing MRS.
Properties of Indifference Curve
Indifference curves have the following four basic properties:
1. Indifference curves have a negative slope;
2. Indifference curves of imperfect substitutes are convex to the origin;
3. Indifference curves do not intersect nor are they tangent to one another;
4. Upper indifference curves indicate a higher level of satisfaction.
